Solar Energy: Not Just for California Anymore

October 19, 2017

In the spring of 2016, DTE Energy broke ground on its Lapeer Solar Park, which was at the time the largest solar array east of the Mississippi River. Now that the 200,000-panel solar park is operation, solar energy makes up 7% of DTE’s renewable energy generation portfolio. Said another way, DTE’s solar projects can produce enough clean energy to power 14,000 homes.

As the political winds in Washington seem to be blowing towards the increased use of coal and nuclear energy, the electric utility industry is doubling down on the power of the sun for a very simple reason.

“The cost of solar has gone way down,” noted Richard McMahon, vice president of Energy Supply and Finance at the Edison Electric Institute. The price for a kilowatt-hour of electricity on a utility scale has been cut in half from more than $4 an hour in 2010 to about $2 in 2015.

Photovoltaic panels have become cheaper to build as federal tax credits help spur the rise of solar. Solar has already achieved grid parity pricing with fossil fuels in some markets, which is drawing and holding the attention of several large utilities.

“It’s the utilities you would expect. They’re based in California, Hawaii and Arizona, but increasingly you’re seeing it in other parts of the county,” McMahon told Daily Energy Insider.

A recent report published by the Smart Electric Power Alliance (SEPA) charts a growth rate of 84 percent in 2016 for utility-scale solar interconnections. The segment includes power purchase agreements (PPAs), utility-owned systems not associated with customer accounts, and merchant power plants connected to the grid and selling into the wholesale markets.

The list of utilities adding the most megawatts in capacity include Pacific Gas and Electric, Southern California Edison, San Diego Gas & Electric, and Arizona Public Service in the west. In the east, the major players are Duke Energy Progress, Dominion North Carolina Power and Florida Power & Light.

Federal energy policy defers a lot of the fine grain utility regulation to individual states since energy trading methods vary across the country. Many of the early adopters of residential solar were led there by federal tax credits coupled with state tax credits created by renewable portfolio standards.

As the systems became more efficient and prices dropped the utilities began easing into solar by building their own solar generation systems and through PPAs in which third party developers build the solar farms.

Alex Hobson, senior communications manager for the Solar Energy Industries Association (SEIA), said, “In many parts of the country, solar is now the cheapest electricity option. Through Q2 2017, voluntary procurement has accounted for 59 percent of all utility-scale solar PPAs signed in 2017.” Voluntary procurement refers to moves into solar not affected by portfolio standards but rather market forces.

Portfolio standards are still in place and still greasing the skids for solar. But there are other factors.

Daisy Chung, research manager for SEPA said, “The utilities are being asked to provide greener choices – if the utility doesn’t offer it the customer might go elsewhere.

If the solar panels were on rooftops it would reduce the load on the distribution network instead on increasing it. Privately owned solar arrays are more efficient and cost effective than sending it through a substation transformer, miles of distribution network that must be protected from trees and wind, and finally through a service transformer. Redistribution of a distributed energy source is redundant, less efficient, more expensive, and simply fails the logic test. The electric industry justifiably considers solar panels an existential threat and is reacting by imposing unjustifiable “grid access fees” and discriminatory pricing to slow their slide from total hegemony. Demand economic justice for private homeowner and business solar energy investment.

Notice how often you just used the word “private”? That’s called privatization of energy. Not a good thing. Rooftop PV is also the most expensive way to build solar. Not a good thing. People who pay to have their own solar on the own roof for their own private use don’t like to spend a dime to help other people use renewable energy. Not a good thing.

Here is described a community-level PV install. For all we know, it might be community-owned, which is a good thing. Or, it might be in contract to the community for a certain price for a very long time. Which is also a good thing. It is not on anyone’s roof, which means it will not have to be dis-and re- assembled every twenty years. Which is a good thing.

So-called “distributed” power is not the perfect answer all the time. In fact, our energy needs in future will dwarve our ability to generate it on rooftops, so more centralized, larger scale and better sited energy farms are crucial and very beneficial.

We already know that China has the lowest labor rates in the world but when Chinese manufacturing is powered by renewable energy I get the feeling that no politician will ever be able to bring manufacturing jobs back to the West (or even the USA). Even with high tariffs, local companies just couldn’t compete.